Cigna will expand its Medicare Advantage health plan offerings
to seniors in dozens of new counties next year in what is quickly becoming a
competitive business for health insurance giants.
For now, Cigna offers largely individual health maintenance
organization (HMO) plans in 260 counties spread across 16 states. But the
insurer plans to enter 37 new counties with such HMO offerings for what
executives said will be a 14% increase in the company’s Medicare Advantage
footprint, pending regulatory approvals.
“We see tremendous growth opportunity in MA, starting in
2020,” Cigna chief executive David
Cordani told analysts Thursday on the company’s second quarter
earnings call.
Cigna is broadening its offerings as well with less restrictive
preferred provider organization (PPO) products. While HMOs generally restrict
choices of medical care providers to health plan networks, PPOs can be more
popular by allowing choice outside of the network though generally at a greater
cost to the health plan enrollee.
Cigna will introduce individual PPO Medicare Advantage plans in
43 counties for 2020, executives said. Cigna wasn’t commenting Thursday
on prices or specific details of its “local geographic market plans,” saying
they still need final approval from the Centers for Medicare & Medicaid
Services.
Cigna is joining the parade of established health plans and
startups looking to take advantage of new rules that allow Medicare Advantage
plans to offer more benefits to seniors.
Cigna’s expansion into new Medicare Advantage regions is the
latest expansion for such plans, which contract with the federal government to
provide extra benefits and services to seniors, such as disease management and
nurse help hotlines with some also offering vision, dental care and wellness
programs. Several health plans, including Aetna, Anthem, Centene, Humana and
UnitedHealth Group are looking to expand their Medicare Advantage businesses
next year and beyond as well. And now insurers are rolling out more
supplemental benefits in their Medicare Advantage plans following rule changes
implemented.
Cigna's Medicare Advantage business had 440,000 members as of the end
of the second quarter and its MA business remains several times smaller than rivals
like UnitedHealth, Aetna and Humana, but Cordani expects the
business is on the verge of a breakout. “In Medicare Advantage we expect 10% to
15% average annual customer growth, driven by both product and geographic
market expansion beginning in 2020,” Cordani said.
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